City, county OK Master Agreement changes for FedEx

Published: Wednesday, March 20, 2013 at 6:13 p.m.

Last Modified: Wednesday, March 20, 2013 at 6:13 p.m.

The Ocala City Council and the Marion County Commission on Tuesday approved changes to the Master Agreement with a private developer that accommodate the proposed FedEx Ground Package System Inc.'s distribution hub at the Ocala/Marion County Commerce Park along Interstate 75.

FedEx plans to build a 383,161-square-foot distribution center on 150 acres at the Commerce Park, which is owned by private developer Ocala 489 LLC. The center, which will require an investment by FedEx of $122.9 million in buildings and equipment, is expected to create 165 jobs paying an average annual wage of $31,536.

Based on that, the city and county have provided an incentive package totaling $3.47 million.

Because FedEx wanted to have its facility located closer to I-75 and a four-lane road rather than two-lane road, changes had to be made to road and utility alignments.

"They are pretty reliant on roads and utilities being in place on time," Steven Gray, attorney for Ocala 489, told the City Council on Tuesday.

Pieces of the project are beginning to fall into place.

For one thing, Ocala 489 has finalized the sale of 150 acres in the Commerce Park to FedEx. The Commerce Park is located east of I-75 and north of U.S. 27. The closing could be as early as June, with the outside date being the third quarter this year.

Another key piece of the puzzle fell into place Tuesday, when the state of Florida approved the $990,000 Qualified Target Industry Grant, which FedEx earns if it meets certain hiring goals.

And the company has submitted two site plans to the city, one for the first phase and another for the "Ultimate" plan.

The first phase includes five buildings. The distribution building will be 403,139 square feet, which is larger than originally proposed. The other buildings include a 7,550-square-foot vehicle maintenance garage; a 3,677-square-foot gateway building; a 3,200-square-foot truck wash building; and a small gate house. There will be 444 parking spaces.

The "Ultimate" site plan proposes six buildings, the sixth being a second small gate house. The distribution center would expand to 583,615 square feet, and the vehicle maintenance garage would increase to 14,028 square feet. The plan also calls for an increase of 500 parking spaces to 944 spots.

To meet its incentive agreement with the city, FedEx is required to reach its capital investment target and number of jobs during Phase 1.

"We have always been aware they have been discussing possible phasing," said Marc Mondell, the city's executive director of community development. But the phasing was not central to the incentive discussions because that agreement was based on the capital investment and jobs, he said.

Construction on the project must begin by July 31, 2014, and be completed by Oct. 31, 2016.

"We expect they will exceed these dates if they decide to go forward," Mondell said about FedEx.

Mondell said he believes construction could begin as early as January 2014.

A major change to the Master Agreement among the city, county and Ocala 489 now gives FedEx standing. Because it was not party to the Master Agreement, FedEx had no recourse if the city, county or Ocala 489 failed to meet their obligations. A change to the Master Agreement gives FedEx the right to sue those parties should they fail to perform, or to complete any unfinished work itself and seek repayment through legal channels.

The city expects that a $2.15 million grant from the state Department of Transportation and Department of Economic Opportunity would pay the costs of modifying the road and electric utility line alignments.

An $800,000 federal Economic Development Administration grant pays for the entrance road to the project.

There still are a few pieces that need to be completed before the project moves forward.

Gray said there are a number of other agreements that will follow the one presented on Tuesday, including the power line relocation agreement with the city and the gas transmission line relocation agreement with Florida Gas.

<p>The Ocala City Council and the Marion County Commission on Tuesday approved changes to the Master Agreement with a private developer that accommodate the proposed FedEx Ground Package System Inc.'s distribution hub at the Ocala/Marion County Commerce Park along Interstate 75.</p><p>FedEx plans to build a 383,161-square-foot distribution center on 150 acres at the Commerce Park, which is owned by private developer Ocala 489 LLC. The center, which will require an investment by FedEx of $122.9 million in buildings and equipment, is expected to create 165 jobs paying an average annual wage of $31,536.</p><p>Based on that, the city and county have provided an incentive package totaling $3.47 million.</p><p>Because FedEx wanted to have its facility located closer to I-75 and a four-lane road rather than two-lane road, changes had to be made to road and utility alignments.</p><p>"They are pretty reliant on roads and utilities being in place on time," Steven Gray, attorney for Ocala 489, told the City Council on Tuesday.</p><p>Pieces of the project are beginning to fall into place.</p><p>For one thing, Ocala 489 has finalized the sale of 150 acres in the Commerce Park to FedEx. The Commerce Park is located east of I-75 and north of U.S. 27. The closing could be as early as June, with the outside date being the third quarter this year.</p><p>Another key piece of the puzzle fell into place Tuesday, when the state of Florida approved the $990,000 Qualified Target Industry Grant, which FedEx earns if it meets certain hiring goals.</p><p>And the company has submitted two site plans to the city, one for the first phase and another for the "Ultimate" plan.</p><p>The first phase includes five buildings. The distribution building will be 403,139 square feet, which is larger than originally proposed. The other buildings include a 7,550-square-foot vehicle maintenance garage; a 3,677-square-foot gateway building; a 3,200-square-foot truck wash building; and a small gate house. There will be 444 parking spaces.</p><p>The "Ultimate" site plan proposes six buildings, the sixth being a second small gate house. The distribution center would expand to 583,615 square feet, and the vehicle maintenance garage would increase to 14,028 square feet. The plan also calls for an increase of 500 parking spaces to 944 spots.</p><p>To meet its incentive agreement with the city, FedEx is required to reach its capital investment target and number of jobs during Phase 1.</p><p>"We have always been aware they have been discussing possible phasing," said Marc Mondell, the city's executive director of community development. But the phasing was not central to the incentive discussions because that agreement was based on the capital investment and jobs, he said.</p><p>Construction on the project must begin by July 31, 2014, and be completed by Oct. 31, 2016.</p><p>"We expect they will exceed these dates if they decide to go forward," Mondell said about FedEx.</p><p>Mondell said he believes construction could begin as early as January 2014.</p><p>A major change to the Master Agreement among the city, county and Ocala 489 now gives FedEx standing. Because it was not party to the Master Agreement, FedEx had no recourse if the city, county or Ocala 489 failed to meet their obligations. A change to the Master Agreement gives FedEx the right to sue those parties should they fail to perform, or to complete any unfinished work itself and seek repayment through legal channels.</p><p>The city expects that a $2.15 million grant from the state Department of Transportation and Department of Economic Opportunity would pay the costs of modifying the road and electric utility line alignments.</p><p>An $800,000 federal Economic Development Administration grant pays for the entrance road to the project.</p><p>There still are a few pieces that need to be completed before the project moves forward.</p><p>Gray said there are a number of other agreements that will follow the one presented on Tuesday, including the power line relocation agreement with the city and the gas transmission line relocation agreement with Florida Gas.</p><p><i>Contact Susan Latham Carr at 867-4156 or susan.carr@starbanner.com.</i></p>